Men's Wearhouse ready to meet with Jos. A. Bank to discuss merger

Men's Wearhouse said Friday it is ready to meet with Jos. A. Bank Clothiers to discuss a merger, a day after Hampstead-based Bank said it's willing to hear how much more the larger chain would boost its acquisition bid.

"The Men's Wearhouse board believes that the acquisition of Jos. A. Bank by Men's Wearhouse has strategic logic and the potential to deliver substantial benefits to our respective shareholders, employees and customers," Men's Wearhouse CEO Douglas S. Ewert said in a letter to Bank Chairman Robert N. Wildrick.

The two chains have been locked in a nasty takeover battle for months. On Thursday, Bank rejected an increased bid by Men's Wearhouse of $63.50 per share but said it would meet to discuss a merger. Men's Wearhouse had said it would consider an increase to $65 per share if Bank offers access to its financial information.

Ewert said in the letter the larger chain planned to send Bank's board a request Friday outlining specific company information it wants to review and plans to start scheduling meetings with Bank senior executives.

Those meetings are likely to happen as early as this weekend, one expert said.

"It's becoming a lot less hostile," said Karyl Leggio, dean of Loyola University Maryland's Sellinger School of Business and Management.

It appears the two retailers are close on price, she said, based on Bank's previously announced stock buyback of 4.6 million shares for $65 each. The buyback would only be consummated if Bank follows through on its announced plans to acquire outdoor apparel retailer Eddie Bauer. Men's Wearhouse's offer hinges on Bank dropping plans to buy Bauer.

Moving closer on price also means a merger could be announced soon.

"At this point Jos. Bank is going to open its books to Men's Wearhouse, and it's hard to go back from there," Leggio said. "Men's Wearhouse will have a competitive advantage seeing their margins on their products."

She predicted the chains would settle on a price in the range of $65 per share to $70 per share.

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